Small Business Bankruptcy Attorneys: 6 Marks of Real Subchapter V Experience

Subchapter V experience can be checked, and the check takes an afternoon. Nearly every event that matters in a small business reorganization leaves a filing on a public docket, which means a lawyer's claim to know this subchapter is a claim about documents that already exist.

Subchapter V has been part of Chapter 11 since 2020, long enough for any lawyer's record in it to be read on the docket rather than taken on trust. The six marks below are the ones an owner can verify before the first meeting ends, or shortly after it.

1. The Docket Is the Only Résumé That Cannot Be Edited

The federal judiciary's PACER service provides electronic public access to federal court records, including every bankruptcy case the lawyer has filed. Case numbers supplied by the lawyer, checked against the docket, will show the chapter, the debtor, and the outcome.

What matters is the outcome. A petition proves only that a case was opened. The documents worth reading come later: an order confirming a plan, a notice of substantial consummation, a final decree. A lawyer whose Subchapter V cases end in dismissal or conversion may have good explanations, and the owner is entitled to hear them.

2. A Confirmation Under Section 1191(b) Is the Harder Credential

A Subchapter V plan can be confirmed two ways. Under Section 1191(a), confirmation is consensual and requires the ordinary Chapter 11 standards, apart from one. Under Section 1191(b), the court "shall confirm the plan" at the debtor's request even when impaired classes have not accepted, provided the plan "does not discriminate unfairly, and is fair and equitable" toward each dissenting class.

The fair and equitable standard in Subchapter V has its own content. The debtor must commit all projected disposable income for three years, or a longer period of up to five that the court fixes, to plan payments (or distribute property of equivalent value), and must show either that it can make every payment or that there is a reasonable likelihood it can, with appropriate remedies if it does not. Disposable income excludes what is reasonably necessary to continue, preserve, and operate the business. And because Section 1181(a) makes the ordinary Chapter 11 cramdown provision inapplicable, the absolute priority rule does not stand in the way: the owners may keep their equity without paying dissenting unsecured creditors in full.

That last feature is what draws owners to the subchapter (the merchant cash advance funders who vote against a plan will insist the rule is a gift to debtors, which is an argument for Congress rather than for the confirmation hearing), and it is also the reason a nonconsensual confirmation is harder to win. The projections must survive a contested hearing. The disposable income calculation will be contested line by line. A lawyer who has taken a plan through Section 1191(b) over objection has done something a lawyer with only consensual confirmations has not.

The aftermath differs too. After a consensual confirmation the ordinary Chapter 11 discharge applies on confirmation, and the trustee's service ends at substantial consummation. After a nonconsensual one, the discharge under Section 1192 waits until the debtor completes the payments due within the first three years, or the longer period the court fixed, and excludes debts "of the kind specified in section 523(a)." How that exception applies to a company, as opposed to an individual owner, is a question this article leaves where the sources used for it leave it.

3. The Ninety Day Plan Measures Preparation Done Before Filing

Section 1189(b) requires the debtor to file its plan within 90 days of the order for relief, and only the debtor may file one. The court may extend that deadline only if the need arises from circumstances "for which the debtor should not justly be held accountable."

Sixty days into the case, at most, the court holds a status conference under Section 1188, and at least 14 days before it the debtor files a report on its efforts to reach a consensual plan. The calendar is compressed enough that an experienced lawyer begins the liquidation analysis and the projections before the petition. An owner can ask how much of the plan exists on the day of filing. The answer reveals more than the fee quote does.

4. The Trustee Relationship Is Part of the Work

Every Subchapter V case has a trustee: a standing trustee where one has been appointed, and otherwise one disinterested person named by the United States Trustee, or the United States Trustee itself. Section 1183(b) directs that trustee to appear at the status conference and at hearings on valuation, confirmation, modification, and asset sales, to see that the debtor begins making timely plan payments, and to help the parties develop a consensual plan.

A lawyer who has worked with the trustees in a district knows how they read projections. That knowledge is difficult to prove and easy to claim, which is a reason to weigh it after the docket, not before.

5. Eligibility Arithmetic Must Use the Current Figure

Subchapter V is open only to a "small business debtor" under Section 101(51D). The debt ceiling is $3,424,000 of noncontingent, liquidated secured and unsecured debt as of the petition date, the figure in effect since April 1, 2025, excluding debts owed to affiliates or insiders, and at least half of the debt must have arisen from business activity. Congress has been considering legislation to restore a higher limit; the Bankruptcy Threshold Adjustment Act of 2026 passed the Senate and the House in separate versions and had not been enacted as of late September 2026. The current limit is something to confirm with counsel on the day of filing, not something to read from an older article.

A lawyer who quotes the higher figure as settled law is, to be generous, behind the news. A lawyer who asks which of the company's debts are contingent or disputed, before quoting any figure at all, is doing the work the definition requires.

6. The Petition Arrives With Four Documents Attached

Section 1187(a) requires a Subchapter V debtor to file the documents Section 1116(1) describes: the most recent balance sheet, statement of operations, cash-flow statement, and federal income tax return, or a statement under penalty of perjury that they do not exist.

Experienced counsel asks for them in the first meeting.

Where a Negotiated Resolution Fits

Delancey Street does not handle Subchapter V cases, because it is not a law firm and does not practice before any court. Its role is earlier and narrower: a confidential initial review, without charge, of whether merchant cash advance obligations can be settled or restructured privately, with independently licensed counsel involved where the question is legal. A business that needs to bind a dissenting funder, stop an active levy, or keep equity against objection needs the lawyer this page describes. A business whose problem is one or two balances and a willing counterparty may not need a court at all, and the difference is worth learning before the ninety days begin.